- The EU determines whether Luxembourg has the internet mail order company, Amazon grants unfair tax advantages. In a preliminary ruling, the European Commission concludes: The model is illegal
- Luxembourg Amazon and defend against it.. The Grand Duchy has sent further documents to Brussels that should allay the suspicion.
- The EU now published report shows in detail how far Amazon Luxembourg has accommodated to enable the Group there pay significantly less taxes. After Luxembourg flow also gains from Amazon.de.
From Bastian Brinkmann
After only eleven working days Amazon got its charter. In this short time reviewed and approved the Luxembourg authorities, the complex control model for the new European headquarters of the internet marketing company. And the model is extremely advantageous. So advantageous that the European Commission sees it, is strong evidence that it is illegal. Now the authorities in Brussels presented first detection results (PDF)
This method is controversial for Amazon, for Luxembourg -. And for Commission President Jean-Claude Juncker. If Junckers authority to remain in their judgment, Amazon threatens a high repayment. The Group would have to repay all the tax benefits in the worst case, it is presumed to hundreds of millions of euros. And the Grand Duchy of Luxembourg would be after the reports of leaks again as a tax haven in the pillory. The revelations had shown how the Grand Duchy helps international and German corporations to avoid paying taxes in the billions.
Calculated the Commission President took Amazon
For Jean-Claude Juncker, the process is uncomfortable because he has gotiations that Amazon is coming to Luxembourg – at that time he was Prime Minister of the Grand Duchy. That the mail order company who locate noble in his country, was also due to a “reasonable tax policy,” he said at the time.
The EU report from October, but the Commission will publish it until now. This is common in such processes. The Luxembourg Government asserts to have delivered more documents since the fall of the authorities in Brussels. This should demonstrate that the control model is still perfectly legal
The preliminary result. Amazon’s model is illegal
The key question is whether the Group has received an unfair advantage. For in Brussels, the case goes as aid procedures. The Commission is therefore whether the State Luxembourg Amazon over other companies preferred. The Preliminary Report, the Authority classifies the control model as illegal aid. Amazon disagrees: The Group did not get any special tax treatment, a spokesman said
The Commission has identified a number of documents.. About eleven working days in which Amazon’s model has been approved by the competent Luxembourg authority. This was “a very short period of time”, the Commission judges to examine the intricate designs from Amazon. Furthermore, the Grand Duchy permission already granted in 2003 – and this applies unchanged since then. Also, the place, the Commission suspicious. In other EU countries such control models are regularly reviewed after a few years, if they are still appropriate. Luxembourg has omitted. From Brussels view an error.
And then there are the cash flows. Amazon concentrates all profits from the European operations in the Amazon EU Sàrl. There thus also the profits from Amazon.de should be taxed. But the Amazon EU Sàrl performs much money from to another subsidiary, the Amazon Europe Holding Technologies SCS. You must pay no tax in Luxembourg. Namely on disclaims any revenue directly to two American Amazon’s subsidiaries. The EU censored the names of the companies in order to preserve Amazon’s trade secrets. However, it is known that it is A9.com Inc. and Amazon Technologies, Inc.. The latter sits in American tax haven Nevada.
“Cosmetic package” instead of fair payments
The Amazon EU Sàrl must pay the other company charges for it because Amazon.de and online Stores use in other countries, the software that runs the mail order business. The amount of these fees must actually geared to how much Amazon.de sold. The more successful the software is used, the more fees.
But Amazon and Luxembourg have a different model negotiated. The EU Commission calls it a “cosmetic package”. It is only at first glance, the payment is based on the sales figures. In fact, Amazon Calculates the Service royalties based on the profits of the Amazon EU Sàrl, should actually be taxed. This can be shifted in large parts of the Amazon Europe Holding Technologies SCS has to pay in any Luxembourg tax. Only a small amount of profit must remain in the Amazon EU Sàrl. This is capped at a maximum of 0.55 percent of sales. This limit “seems to be too low”, the European Commission says.
Even Apple and Starbucks in Focus
The EU is now examining the additional documents that Luxembourg has delivered. A final decision is still pending. The Grand Duchy could proceed before the European Court of Justice against a potential conviction, too.
Similar procedures also run against the computer Bauer Apple and Ireland, and of the coffee chain Starbucks and the Netherlands. The Commission is currently examining also the Member States whether they also offer unfair tax loopholes for corporations.
The President of the Authority, Jean-Claude Juncker, repeatedly stressed that he will stay out of these investigations. After all, he is considered one of the architects of tax haven Luxembourg. There, the way Amazon has a good reputation. The then Finance Minister Luc Frieden said in 2012 at a company party, his government was grateful and proud that the Internet traders have settled in Luxembourg. Because: “Amazon is a good taxpayer.”
No comments:
Post a Comment